More people in the UK are working beyond retirement than ever before1, but new research from LV= reveals the majority of ‘Grey Collar Workers’ enjoy it and very few are doing it just for the money.
LV= has found nearly nine in 10 (87%) people working aged 65 and over are happy to be in employment, with two in five (40%) working out of choice and only one in 10 (11%) feeling obliged to work because they need the money. This is in stark contrast to three years ago2 when a quarter (26%) of people at retirement age were unhappy to still be working.
The study also found people are now choosing to phase their retirement, with one in seven (14%) approaching retirement age opting for semi-retirement,3 and gradually reducing their hours, rather than retiring straight from full time work.
The Government’s pension reforms have given people more freedom over their retirement options, with people now able to access their money as they wish and no longer tied to buying an annuity. The industry has responded with new solutions that allow people to use combinations of products to best meet their needs in retirement, which offer them both flexible access to their pension and security. However, with increased choice it’s important people have the support they need to make this decision, particularly as many are worried about their savings.
LV= also found more than half (55%) of those approaching retirement are concerned they won’t have enough saved and a similar percentage (56%) think they’ll need to find income from other sources. It is important people are encouraged to save early on, but it’s also crucial people have access to regulated financial advice at retirement, whether traditional or online, as this will help them get more from their money.
John Perks, Managing Director of Retirement Solutions at LV=, said: “Many people are staying active and remaining at work because they want to, but with large numbers approaching retirement worried they won’t have enough saved, there is a risk that the next generation of ‘Grey Collar Workers’ will have to work out of necessity.
“The pension freedoms have given older workers more flexibility to choose the type of retirement they want, and how they fund it, but with more choices than ever before it’s important to plan both before and at retirement. People approaching retirement need access to affordable, regulated advice to help them shop around and get more from their money, giving them the freedom to decide how long they want to keep working.”
The research is part of LV=’s annual State of Retirement study, which outlines the typical financial situations for retirees, before and at retirement age. The second chapter looks specifically at ‘Grey Collar Workers’; those pensioners working into their retirement, either through necessity or a desire to stay active. The full report will be released in the summer.